Friday, September 20, 2024

Shapoorji Pallonji Group’s Infrastructure Unit Afcons Infrastructure Gets SEBI Approval For Rs 7,000 Crore IPO

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Shapoorji Pallonji Group's infrastructure unit—Afcons Infrastructure Ltd.—has received approval from the Securities and Exchange Board of India to raise Rs 7,000 crore through an initial public offering. The company submitted its IPO documents to SEBI on March 2024.

The IPO includes a fresh issue of Rs 1,250 crore and an offer for sale of Rs 5,750 crore by Goswami Infratech Pvt. Ltd. Proceeds from the fresh issue will go towards capital expenditure, working capital, debt repayment, and general corporate purposes, according to its media statement.

The company's IPO aims to address its financial constraints by raising essential funds. As part of its strategy to optimise finances and capitalise on favourable macroeconomic conditions, the Shapoorji Pallonji Group has been systematically divesting assets to reduce its debt burden.

Afcons operates in various infrastructure sectors, including marine, surface transport, urban infrastructure, hydro and underground, and oil and gas projects.

Afcons’ order book rose at a compound annual growth rate of 7.6%, increasing to Rs 30,405.77 crore in 2023 from Rs 26,248.46 crore in 2021. As of September 2023, it stood at Rs 34,888.39 crore.

Investors Swarm Into IPOs To Exploit Equity Market’s Record Run

The company’s restated consolidated revenue from operations for the fiscal year 2022-2023 rose by 14.69% to Rs 12,637.38 crore from the previous year. Its net profit increased by 14.89% Rs 410.86 crore in 2023.

At present, promoter and promoter group entities hold a significant 99.48% stake in Maharashtra-based Afcons Infrastructure. The IPO will mark the second time a company from the Shapoorji Pallonji Group has tapped the primary market, following Sterling and Wilson Renewable Energy Ltd.

Sterling and Wilson Renewable Energy made its stock market debut in August 2019 but was later acquired by Reliance Industries Ltd. after the SP Group divested shares to alleviate debt.

At present, only two Shapoorji Pallonji Group entities—Forbes & Co and Gokak Textiles Ltd.—are listed on the stock exchanges.

ICICI Securities, DAM Capital Advisors, Jefferies, Nomura, Nuvama and SBI Capital are the book-running lead managers. Link Intime is the registrar of the issue.

Ten Most-Valued Firms Lose Rs 9,000 Crore In Market Cap, Dragged By HUL, TCS. Read more on IPOs by NDTV Profit.

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